What Is the Main Reason Why Formal Institutions Limit Alliances

question 24

Multiple Choice

What is the main reason why formal institutions limit alliances and acquisitions in the areas of formal market entry modes?

• A) Many governments discourage acquisitions in order to establish local-only subsidiaries.
• B) The liability of foreignness is guaranteed to make the alliances or acquisitions fail.
• C) The governments are unable to tax acquisitions by foreign firms.
• D) The institutions do not limit the firms in regards to entry modes.

---

Definitions:

Stepfamilies

Families formed when a parent marries someone other than the child's original parent, leading to a new family structure.

Immersion

The deep mental involvement or physical placement in a particular activity, culture, or environment, often for learning or experiential purposes.

Defensiveness

A psychological reaction characterized by a refusal to accept or consider criticism or uncomfortable truths about oneself, often as a mechanism to protect self-esteem.

Endogamy

The practice of marrying within a specific social group, caste, or ethnic group, rejecting those from others as inappropriate for marriage or other close relationships.